Constructive Unfair Dismissal

Constructive Dismissal – Reason for Leaving Test

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In a constructive unfair dismissal claim, does the breach of contract by the employer have to be the principal reason for the employee’s resignation?

No said the EAT in Wright v North Ayrshire Council.

The Claimant was employed by the Council as a care at home assistant for just under seven years from 3 December 2003 until her resignation on 24 November 2010. She claimed that there had been a constructive dismissal. The Employment Tribunal here found that there had been breaches going to the root of the contract. Those breaches were in respect of three grievances which had not properly been answered. Two were never responded to and the third was not responded to timeously. However, the Employment Tribunal found that the Claimant’s caring responsibilities for her partner who had suffered a stroke was the “effective cause” of her resignation rather than her employer’s conduct and dismissed her claim.

The EAT found that the Employment Tribunal were wrong to have dismissed the employee’s claim for constructive dismissal on this basis. The EAT held that the repudiatory (i.e. fundamental) breach of contract does not have to be “the” effective cause for the employee resigning but “an” effective cause. In other words, it does not have to be the main reason for resigning it just needs to be one of the reasons. The Employment Tribunal will however take into account the extent of the role played by the breach when calculating the compensation award.

In the case in hand, the EAT remitted the case back to the Employment Tribunal to decide whether the employer’s repudiatory breaches (which it had found) played a part in her resignation from the service of the Council.

Written by
Edward Aston
25th November 2013

Constructive Dismissal

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In the recent case of Logan v. Celyn House Limited the EAT considered whether the “principal reason” for the resignation needed to amount to a fundamental breach of contract for the claim of constructive unfair dismissal to succeed.

In summary, the Claimant was a veterinary nurse who resigned in response to a grievance decision which she found unsatisfactory. The grievance involved a number of matters, including bullying and a failure to pay contractual sick pay. The ET found that the bullying was a figment of her imagination but found that the failure to pay contractual sick pay was a fundamental breach of contract. The ET held that there was a breach of her contract and that it was a repudiatory breach. Notwithstanding this finding, the ET did not find that the Claimant had been constructively dismissed as the ET held that the “principal reason” for the resignation was not the non-payment of contractual sick pay but the complaints of bullying.

The Claimant appealed against the Tribunal’s decision. The appeal was allowed to proceed on one ground only, namely, that the ET approached the question of constructive dismissal in the wrong way by looking at the “principal reason” for the resignation.

The EAT held that the ET had been wrong to look at the “principal reason” for the resignation. The ET should have considered whether there was a repudiatory breach of contract in failing to pay the sick pay and if so, whether it was a reason for the resignation, not whether it was the “principal reason”.

The EAT held that as the Claimant resigned in part because of the failure to pay sick pay and as it was a repudiatory breach, her claim of unfair constructive dismissal succeeded.

Written by
Edward Aston
8th September 2012